Naturals Salon eyes disruption in personal care space via refill model

New model will shave off packing and transportation charges, and allow consumers to pay 60% less than market price

Chinni Krishnan, an agriculturist and pharmacist from Tamil Nadu, sparked the sachet revolution in the Indian personal care segment in the 1970s. In 2024, his son C K Kumaravel is all set to come up with another disruptive model in the fast-moving consumer goods (FMCG) space through Naturals Salon & Spa, the largest salon chain in India.

If Kumaravel’s unique model clicks, customers can refill a shampoo, conditioner, or other personal care item from the nearest Naturals Salon from February. This will cut the packing and transportation charges and customers will have to only pay around 40 per cent of the current price of the product in the market. This comes almost a year after Reliance Retail backed out of a deal with Groom India Salons & Spa, which owns Naturals, to acquire a 49 per cent stake in the salon chain. 

"We are working on a concept called refillable beauty. I have 800 outlets, all these outlets will become refill stations and customers can take a small 100-200 ml pumping in the bottle. You don't have to pay money for packaging. Product will be not even at 40 per cent of the current cost, as the majority of the cost is on packaging and transportation," Kumaravel told Business Standard. 

The company is planning to have its presence in skincare, Korean beauty, ayurveda, and organic segments, among others. The products which are refillable-friendly like shampoo, conditioner, body wash, hand wash, and body moisturisers will be available for refilling in the initial phase.

"We are going to come up with D2C brands. We have already 10 million customers under our membership. We know the needs of Indian customers. We are planning to hit the SME exchange by March and then move to an initial public offering by the end of next year. From SME exchange, we are looking to raise around Rs 70-80 crore," Kumaravel said.

Kumaravel aims to expand his chain from the current 800 outlets to 1,000 outlets by late 2025 and 3,000 outlets by the end of 2029. Last year, Naturals revenue was around Rs 380 crore and is expected to touch Rs 500 crore this year, he said.

"We have only around five company-owned outlets now and we have plans to increase it to 10 per cent by the end of next year. Abroad, we are looking at GCC, the US, Australia, the UK, Europe, Malaysia, Bangladesh, and Singapore. We follow wherever Saravana Bhavan is, no need for a market survey. In Sri Lanka, we already have 14 salons, and another 10 are getting ready," he added.

Naturals has brought cricketers like Smriti Mandhana and Natarajan as ambassadors to ensure more reach for its new business. The company is following a franchisee royalty model.

According to Facts & Factors, the Indian beauty salon market size in terms of revenue was valued at around $10.55 billion in 2023 and is expected to reach a value of $22.12 billion by 2032, growing at a CAGR of roughly 8.57 per cent. Other key market players include Lakmé Salon, Jawed Habib, Shahnaz Hussain, VLCC, Truefitt & Hill, Studio11 Salon & Spa, Green Trends, Looks Salon, Strands Salons, Urban Company, L’Oreal, Vibes, Belleza, and Star & Sitara.